Planting lurches forward
05/09/17 — As planting progress plods along, we also are dealing with the issue of how much damage occurred to the Kansas crop from the snowstorm the last weekend in April.
Crop progress reports out yesterday afternoon (5/8/17) didn’t indicate as much progress in corn and soybean planting as anticipated, with corn planting at 47% complete vs. 52% normally, dropping 5% behind the normal progress. Corn emergence is 15%, behind the average 19% pace. Soybean planting is 14% complete, up only 4% from last week and behind the 17% normally planted by this time. So it was a bit disappointing to see such little progress occur while the western Corn Belt had such nice weather.
HRS wheat planting was 54% complete, still behind the normal pace of 60% planted but there was a total of 23% planted last week, a very good week of planting. Spring wheat is 21% emerged vs. 29% average so that is also behind the normal pace. Barley planting is 53% complete, well behind the average pace of 68% done, with 26% emerged vs. 35% normally at this time. Oats is 79% planted, equal to the average pace, with emergence at 59%, just 1% behind the average 60% pace. Oats crop ratings are 61% rated G/E, down considerably from last year’s 72% rating and a bit disappointing that the crop is not in better shape.
Winter wheat is 50% headed, ahead of the average pace 0f 46% headed. Crop conditions are down 1% this week to 53% rated G/E vs. 62% last year. But frankly, it is surprising that winter wheat conditions only dropped 1% since the heavy snow blanketed western Kansas a weekend ago. But when you look more closely, Kansas wheat conditions have declined significantly since the snow (9% moving from G/E down to poor/very poor and 2% moving from fair to P/VP), so the other winter wheat states must have had some improvement to offset the Kansas decline. It’s hard to imagine the crop improved that much in other states as the snow will be devastating to wheat crops where it hit in Kansas. But that is exactly what crop conditions are saying. (Could it be that they’ve already abandoned 10-20% and are no longer including that crop in the ratings?) The Pro Ag yield model is basically unchanged this week at 49.75 bu/acre, basically the same as last week and two weeks ago before the snow. We find that shocking that so much damage could occur in western Kansas, and still the crop yields are estimated about the same because the non-affected wheat improved that much? Shocking, but so far that is what the market is indicating as well since prices have drifted back to where we were before the snow event. We suspect abandonment of winter wheat in Kansas will be much higher in 2017, but that might not be known for sure until harvest.
To make the situation more interesting, The Kansas wheat tour was conducted last week with various scouting reports and yield estimates. The tour completed on May 4 with a 46.1 bu/acre yield estimate putting total production at 282.7 million bushels. This is down 185 million bushels from last year. This production estimate would mean roughly 20% of Kansas acres would be abandoned. It needs to be noted that scouts did not make yield estimates on fields that were under snow. A Kansas extension agent stated that he had not seen this much water standing in western wheat fields in his 40 years. An argument can be made that moisture in western Kansas is a good thing but certainly the amount could lead to quality issues. We all know the Kansas crop was set back by the heavy snow, the real question is by how much?
Cotton is 21% planted, behind the normal pace of 25% by 4% while sorghum is 30% planted, equal to average. Sugarbeets are 74% planted vs. 70% normally, so we now have surged to 4% ahead of average after planting 26% last week. Pasture conditions are 63% rated G/E, above the 61% rated G/E at this time last year. Soil moisture conditions are wetter than last year at this time, with 91% of topsoil rated adequate/surplus, the same as last week and above last year’s 86%. Subsoil ratings are 89% adequate/surplus, 1% higher than last week and 3% higher than last year. It is understandable the struggle we’ve had planting thus far with the high soil moisture levels this year. The cooler temperatures that started in mid-April also slowed the warming of soils, and thus planting of corn and soybeans. Now that we are into May, planting progress may accelerate if we have the right kind of weather (warm and dry).
The weather forecast for the next 7 days is not perfect for planting (warm and dry), but it isn’t terrible either. Weather forecasters are calling for above normal temps in the western Corn Belt, but below normal in the eastern Corn Belt. Precip will be normal to above normal in a few states including Nebraska, Iowa, Missouri, and Colorado. But the rest of the country will enjoy below normal precip the next 7 days. The 8-14 day forecast is for above normal temps in virtually all of the Corn Belt, and below normal on the western seaboard. Precip will be above normal in most of the U.S. except the eastern seaboard. Overall, it looks like a decent planting window opens up for the next week to 10 days, and then a wet period is forecast to come back into play and may slow progress to more normal rates by mid-May.
Currently, it seems that grain prices are still drifting lower, and until something changes the outlook, that seems like the direction of least resistance.